DCCC1144/2024 HKSAR v. SHAM CHUN MAN, SIMON - LawHero
DCCC1144/2024
HKSAR v. SHAM CHUN MAN, SIMON
區域法院（刑事）Deputy District Judge L C Cheng6/5/2026[2026] HKDC 823
DCCC1144/2024
DCCC 1144/2024 [2026] HKDC 823 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CRIMINAL CASE NO 1144 OF 2024 ________________________ HKSAR v SHAM CHUN MAN, SIMON ________________________ Before: Deputy District Judge L C Cheng Date: 7 May 2026 Present: Ms Yuen Man Kong, Zena, Senior Public Prosecutor of Department of Justice for HKSAR Mr Allan William G, instructed by Kong & Lam, Solicitors, for the defendant Offence: [1] – [5] Fraud（欺詐罪） ________________________ REASONS FOR SENTENCE ________________________ 1. The defendant (“D”) was charged with 5 counts of fraud. He pleaded guilty to all charges. Facts of the case 2. Union Faith International Limited (“VTC”) was established by D’s parents, who were the only shareholders and directors of VTC since 2019. 3. VTC held 8 properties and 4 car parking spaces. Market value of VTC’s properties was estimated to be HK$228 million. In November 2023 when D’s parents wished to mortgage one of the properties of VTC, the mortgage application was rejected since the bank found out that they were no longer the directors and shareholders of VTC according to the records of the Companies Registry (“CR”). Then, it was found that some of the properties of VTC were mortgaged without their knowledge. They reported the case. 4. What happened was that in 2023, D submitted forged documents to CR and the Inland Revenue Department (“IRD”) to usurp the directorship and shares of VTC. Based on the records of the CR, documents relating to VTC were filed to CR between 27 April 2023 and 21 November 2023. These documents included the notice of change of company secretary and director (Appointment/Cessation) Forms and Annual Return Forms. D was the presenter of those forms, which bear a company chop different from the genuine company chop of VTC. Pursuant to those forms:- (1) D became the sole shareholder of VTC; (2) D’s parents resigned from being VTC’s director; and (3) D and another person (“WP”) were appointed director of VTC. 5. When D “appeared” to be the shareholder and director of VTC, 3 properties held by VTC were mortgaged to 5 different finance companies for mortgage loans on behalf of VTC. In support of the loan application, D would provide documents to the finance companies to show his purported shareholding of VTC or board meeting minutes bearing WP and his signatures. Details of the said loans were:- Date of loan (starting from application of the loan until the date of loan) Finance Company Amount ofloan (HK$) Charge 19 to 23 May 2023 Greater China Finance Limited 5 million Charge 1 7 to 14 July 2023 Megawealth Mortgage Financing Co Ltd 5 million Charge 2 1-11 September 2023 AB Capital Management Limited 600,000 Charge 3 1 October to 30 November 2023 Kellett Financial Services Limited 6,010,000 Charge 4 9 to 13 November 2023 Com Po Financial Holdings Limited 10 million Charge 5 6. The staffs of all finance companies confirmed that they would not have granted the loans to VTC if they know that D was not the genuine director and shareholder of VTC. 7. The total loan money was HK$26.61 million. Over HK$15 million of the loan was deposited into the bank account of D. The remaining was basically utilized for repayment of VTC’s loan, including the HK$5 million loan by Greater China. 8. D also transferred an aggregate sum of HK$821,400 to WP between 21 September and 5 December 2023. Background and mitigation of D 9. D was born in Hong Kong and is now 57 years old. He came from a wealthy family and obtained a university degree from an Australian University. He was married and has 3 grown-up children. D had worked for his father. However, due to the present case, he had destroyed his relationship with all his family member, including his own children. He has had no contact with his own parents for a few years. 10. Also, he was adjudicated bankrupt. Effectively, he has become homeless and was required to live at his friends’ home on a charitable basis. He also suffers from poor health due to diabetes and gout. 11. D is a person of clear record and his religious background has provided him support. He also wrote a letter expressing his remorse. Combining what he said in his letter and what he told the probation officer, he was greedy at the material time and wanted money for settlement of gambling debts and for investment. He lost all the money in the investment. 12. Mr William Allan, Counsel for D, submitted that D, being the eldest son in his family, lost the chance of receiving any inheritance from his parents. 13. Mr William Allan emphasized the remorseful attitude of D, who had pleaded guilty and therefore greatly saved the court time and effectively excused D’s parents from testifying in court. In the absence of any sentencing guidelines in respect of fraud cases, Mr William Allan suggested that 3 years’ imprisonment as the starting point for each charge would be appropriate and submitted that the totality principle should be considered. 14. Besides, Mr William Allan asked me to consider the restitution regarding Charge 1 because D had paid back HK$5 million to Greater China through the loan from Com Po. Sentence Consideration 15. According to section 16A(1) of the Theft Ordinance, the maximum sentence for each offence of fraud is imprisonment for 14 years. 16. Since the offence of fraud can be committed in vastly different circumstances, the Court of Appeal has not laid down any sentencing tariff. The sentence to be imposed in each case must be determined according to the facts of that case. In HKSAR v Ng Tik Ki Chaneki, CACC 68/2011, the Court of Appeal said:- “51. Criminal frauds take on an almost infinite variety of shapes, seeking to inflict all manner of harm. … … For such reasons, in respect of crimes of fraud, there is no sentencing ‘tariff’ as such.” 17. In HKSAR v Ho Ka Keung (No 2) [2009] 1 HKC 88, the Court of Appeal explained the relevant factors in determining the sentence for commercial fraud cases:- “11. ... It is well established that commercial fraud will attract, other than in exceptional circumstances, an immediate custodial sentence, even for a first offender. Obviously the length of that sentence will be determined by reference to factors such as, but not exclusively, the nature of the fraud itself; the duration of the fraud; its sophistication; the role played by the convicted person; the effect it may have on the marketplace; whether there are cross-border or international implications; and the nature and extent of the risk to the victim’s proprietary interests, as well as, albeit to a minimal extent, the extent of any loss actually sustained.” 18. In addition, as noted in HKSAR v Tsoi Shu, CACC 461/2003, at para 41, the Court of Appeal emphasized the flexibility in sentencing for fraud and stated that factors including role of defendant in the hierarchy of the fraud operation (eg whether he is a mastermind of the fraud scheme, and whether he plays multiple role in the scheme), his degree of involvement, the duration of the fraud, and the amount of loss suffered by the victims are all relevant. 19. In the present case, there is no doubt that the offences committed by D were very serious. First, the amount of each mortgage loan obtained by D by means of fraud was large, and the total amount was up to a considerable sum of HK$26 million. The actual loss suffered by the finance companies exceeded HK$21 million. 20. Second, the documents submitted to CR and IRD, which was an integral part in the commission of the offences, bear a false company chop. In other words, forged documents were used. 21. Third, although I do not consider the modus operandi employed in the fraud perpetuated by D particularly sophisticated, these offences were all premeditated. 22. Fourth, each of the finance companies had been exposed to substantial risk that it might not be able to obtain repayment of the loans because its loans were in fact not secured by mortgage of any real property. In fact, only Greater China were repaid out of the loan by Com Po. The outstanding loans of other finance companies still exceed HK$21million. Couple with the fact that D is now an adjudicated bankrupt, those finance companies would be in difficulty in enforcing any of the mortgage contracts against D and/or VTC. 23. I do not consider the offences committed by D involved breach of trust. However, in light of the seriousness of the offences, and despite D had a clear record, the only sentencing option is imprisonment. 24. In HKSAR v Ling Veronica (CAAR 1/1998), the respondent in this case pleaded guilty to various charges of forgery and some other charges. In a gist, the respondent produced the false identity cards of her parents to a solicitor’s firm and then obtained 2 Power of Attorney of her parents. With those fraudulently obtained Power of Attorney, the respondent mortgaged the property of her parents to 2 different companies without their knowledge or consent. The respondent obtained about HK$8 million out of the fraud. The Court of Appeal considered that the proper sentence for each set of mortgage offences should be 3 years’ imprisonment, and the proper sentences on the two forged documents charges should be 15 months for each. The total sentence was then reduced to 6 years upon the totality principle, and the respondent’s sentence was reduced by one-third to reflect her guilty plea. The overall sentence was 4 years. Sentence 25. Taking all the circumstance into account, for Charge 1, 2 and 4, I adopt 3 years’ imprisonment as the starting point. For Charge 3, I adopt 2 years’ imprisonment as the starting point. For Charge 5, I adopt 3 years and 3 months’ imprisonment as the starting point. 26. I accept that D has a genuine remorse. His chance of re-offending is trivial, if any at all. He is now deserted from all his family members. He lost all financial support from his parents. It is likely that he will not inherit anything from his parents. However, D is himself to be blamed for his current situation. I do not accept that the personal circumstance of D justifies any reduction in sentence. The most important mitigation factor is the guilty plea and a full one-third discount will be given. 27. For Charge 1, I bear in mind that Greater China suffers no actual loss because Com Po paid HK$5 million odd to Greater China out of the HK$10 million loan granted to D. In the circumstance, I decide to reduce 2 months’ imprisonment for charge 1 after giving the full one-third discount. 28. In the circumstance, the sentence is:- (1) for Charge 1, 1 year and 10 months’ imprisonment; (2) for each of Charge 2 and 4, 2 years imprisonment; (3) for Charge 3, 1 year and 4 months’ imprisonment, and (4) for Charge 5, 2 years and 2 months’ imprisonment. 29. The 5 charges involved 5 different finance companies and the total amount involved exceeded HK$26 million. Taking into account of the totality principle, I order that 4 months’ imprisonment of Charge 1 and 6 months’ imprisonment of each of Charge 2, 3 and 4, are to be run consecutively to Charge 5. 30. The total sentence would be 4 years’ imprisonment (2 years 2 months + 4 months + 6 months + 6 months + 6 months). ( L C Cheng ) Deputy District Judge
DCCC 1144/2024 [2026] HKDC 823 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CRIMINAL CASE NO 1144 OF 2024 ________________________ HKSAR v SHAM CHUN MAN, SIMON ________________________ Before: Deputy District Judge L C Cheng Date: 7 May 2026 Present: Ms Yuen Man Kong, Zena, Senior Public Prosecutor of Department of Justice for HKSAR Mr Allan William G, instructed by Kong & Lam, Solicitors, for the defendant Offence: [1] – [5] Fraud（欺詐罪） ________________________ REASONS FOR SENTENCE ________________________ 1. The defendant (“D”) was charged with 5 counts of fraud. He pleaded guilty to all charges. Facts of the case 2. Union Faith International Limited (“VTC”) was established by D’s parents, who were the only shareholders and directors of VTC since 2019. 3. VTC held 8 properties and 4 car parking spaces. Market value of VTC’s properties was estimated to be HK$228 million. In November 2023 when D’s parents wished to mortgage one of the properties of VTC, the mortgage application was rejected since the bank found out that they were no longer the directors and shareholders of VTC according to the records of the Companies Registry (“CR”). Then, it was found that some of the properties of VTC were mortgaged without their knowledge. They reported the case. 4. What happened was that in 2023, D submitted forged documents to CR and the Inland Revenue Department (“IRD”) to usurp the directorship and shares of VTC. Based on the records of the CR, documents relating to VTC were filed to CR between 27 April 2023 and 21 November 2023. These documents included the notice of change of company secretary and director (Appointment/Cessation) Forms and Annual Return Forms. D was the presenter of those forms, which bear a company chop different from the genuine company chop of VTC. Pursuant to those forms:- (1) D became the sole shareholder of VTC; (2) D’s parents resigned from being VTC’s director; and (3) D and another person (“WP”) were appointed director of VTC. 5. When D “appeared” to be the shareholder and director of VTC, 3 properties held by VTC were mortgaged to 5 different finance companies for mortgage loans on behalf of VTC. In support of the loan application, D would provide documents to the finance companies to show his purported shareholding of VTC or board meeting minutes bearing WP and his signatures. Details of the said loans were:- Date of loan (starting from application of the loan until the date of loan) Finance Company Amount ofloan (HK$) Charge 19 to 23 May 2023 Greater China Finance Limited 5 million Charge 1 7 to 14 July 2023 Megawealth Mortgage Financing Co Ltd 5 million Charge 2 1-11 September 2023 AB Capital Management Limited 600,000 Charge 3 1 October to 30 November 2023 Kellett Financial Services Limited 6,010,000 Charge 4 9 to 13 November 2023 Com Po Financial Holdings Limited 10 million Charge 5 6. The staffs of all finance companies confirmed that they would not have granted the loans to VTC if they know that D was not the genuine director and shareholder of VTC. 7. The total loan money was HK$26.61 million. Over HK$15 million of the loan was deposited into the bank account of D. The remaining was basically utilized for repayment of VTC’s loan, including the HK$5 million loan by Greater China. 8. D also transferred an aggregate sum of HK$821,400 to WP between 21 September and 5 December 2023. Background and mitigation of D 9. D was born in Hong Kong and is now 57 years old. He came from a wealthy family and obtained a university degree from an Australian University. He was married and has 3 grown-up children. D had worked for his father. However, due to the present case, he had destroyed his relationship with all his family member, including his own children. He has had no contact with his own parents for a few years. 10. Also, he was adjudicated bankrupt. Effectively, he has become homeless and was required to live at his friends’ home on a charitable basis. He also suffers from poor health due to diabetes and gout. 11. D is a person of clear record and his religious background has provided him support. He also wrote a letter expressing his remorse. Combining what he said in his letter and what he told the probation officer, he was greedy at the material time and wanted money for settlement of gambling debts and for investment. He lost all the money in the investment. 12. Mr William Allan, Counsel for D, submitted that D, being the eldest son in his family, lost the chance of receiving any inheritance from his parents. 13. Mr William Allan emphasized the remorseful attitude of D, who had pleaded guilty and therefore greatly saved the court time and effectively excused D’s parents from testifying in court. In the absence of any sentencing guidelines in respect of fraud cases, Mr William Allan suggested that 3 years’ imprisonment as the starting point for each charge would be appropriate and submitted that the totality principle should be considered. 14. Besides, Mr William Allan asked me to consider the restitution regarding Charge 1 because D had paid back HK$5 million to Greater China through the loan from Com Po. Sentence Consideration 15. According to section 16A(1) of the Theft Ordinance, the maximum sentence for each offence of fraud is imprisonment for 14 years. 16. Since the offence of fraud can be committed in vastly different circumstances, the Court of Appeal has not laid down any sentencing tariff. The sentence to be imposed in each case must be determined according to the facts of that case. In HKSAR v Ng Tik Ki Chaneki, CACC 68/2011, the Court of Appeal said:- “51. Criminal frauds take on an almost infinite variety of shapes, seeking to inflict all manner of harm. … … For such reasons, in respect of crimes of fraud, there is no sentencing ‘tariff’ as such.” 17. In HKSAR v Ho Ka Keung (No 2) [2009] 1 HKC 88, the Court of Appeal explained the relevant factors in determining the sentence for commercial fraud cases:- “11. ... It is well established that commercial fraud will attract, other than in exceptional circumstances, an immediate custodial sentence, even for a first offender. Obviously the length of that sentence will be determined by reference to factors such as, but not exclusively, the nature of the fraud itself; the duration of the fraud; its sophistication; the role played by the convicted person; the effect it may have on the marketplace; whether there are cross-border or international implications; and the nature and extent of the risk to the victim’s proprietary interests, as well as, albeit to a minimal extent, the extent of any loss actually sustained.” 18. In addition, as noted in HKSAR v Tsoi Shu, CACC 461/2003, at para 41, the Court of Appeal emphasized the flexibility in sentencing for fraud and stated that factors including role of defendant in the hierarchy of the fraud operation (eg whether he is a mastermind of the fraud scheme, and whether he plays multiple role in the scheme), his degree of involvement, the duration of the fraud, and the amount of loss suffered by the victims are all relevant. 19. In the present case, there is no doubt that the offences committed by D were very serious. First, the amount of each mortgage loan obtained by D by means of fraud was large, and the total amount was up to a considerable sum of HK$26 million. The actual loss suffered by the finance companies exceeded HK$21 million. 20. Second, the documents submitted to CR and IRD, which was an integral part in the commission of the offences, bear a false company chop. In other words, forged documents were used. 21. Third, although I do not consider the modus operandi employed in the fraud perpetuated by D particularly sophisticated, these offences were all premeditated. 22. Fourth, each of the finance companies had been exposed to substantial risk that it might not be able to obtain repayment of the loans because its loans were in fact not secured by mortgage of any real property. In fact, only Greater China were repaid out of the loan by Com Po. The outstanding loans of other finance companies still exceed HK$21million. Couple with the fact that D is now an adjudicated bankrupt, those finance companies would be in difficulty in enforcing any of the mortgage contracts against D and/or VTC. 23. I do not consider the offences committed by D involved breach of trust. However, in light of the seriousness of the offences, and despite D had a clear record, the only sentencing option is imprisonment. 24. In HKSAR v Ling Veronica (CAAR 1/1998), the respondent in this case pleaded guilty to various charges of forgery and some other charges. In a gist, the respondent produced the false identity cards of her parents to a solicitor’s firm and then obtained 2 Power of Attorney of her parents. With those fraudulently obtained Power of Attorney, the respondent mortgaged the property of her parents to 2 different companies without their knowledge or consent. The respondent obtained about HK$8 million out of the fraud. The Court of Appeal considered that the proper sentence for each set of mortgage offences should be 3 years’ imprisonment, and the proper sentences on the two forged documents charges should be 15 months for each. The total sentence was then reduced to 6 years upon the totality principle, and the respondent’s sentence was reduced by one-third to reflect her guilty plea. The overall sentence was 4 years. Sentence 25. Taking all the circumstance into account, for Charge 1, 2 and 4, I adopt 3 years’ imprisonment as the starting point. For Charge 3, I adopt 2 years’ imprisonment as the starting point. For Charge 5, I adopt 3 years and 3 months’ imprisonment as the starting point. 26. I accept that D has a genuine remorse. His chance of re-offending is trivial, if any at all. He is now deserted from all his family members. He lost all financial support from his parents. It is likely that he will not inherit anything from his parents. However, D is himself to be blamed for his current situation. I do not accept that the personal circumstance of D justifies any reduction in sentence. The most important mitigation factor is the guilty plea and a full one-third discount will be given. 27. For Charge 1, I bear in mind that Greater China suffers no actual loss because Com Po paid HK$5 million odd to Greater China out of the HK$10 million loan granted to D. In the circumstance, I decide to reduce 2 months’ imprisonment for charge 1 after giving the full one-third discount. 28. In the circumstance, the sentence is:- (1) for Charge 1, 1 year and 10 months’ imprisonment; (2) for each of Charge 2 and 4, 2 years imprisonment; (3) for Charge 3, 1 year and 4 months’ imprisonment, and (4) for Charge 5, 2 years and 2 months’ imprisonment. 29. The 5 charges involved 5 different finance companies and the total amount involved exceeded HK$26 million. Taking into account of the totality principle, I order that 4 months’ imprisonment of Charge 1 and 6 months’ imprisonment of each of Charge 2, 3 and 4, are to be run consecutively to Charge 5. 30. The total sentence would be 4 years’ imprisonment (2 years 2 months + 4 months + 6 months + 6 months + 6 months). ( L C Cheng ) Deputy District Judge